Brazil’s markets tumble as investors bet Lula will add to fiscal pain
Investors had been positioned for victory by rightwing Bolsonaro, seen as more willing to tackle budget deficit
Source: Financial Times
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DW NOTE
Brazil's stock market fell 16% in the two sessions after Lula's election in 2022, and the real dropped 8% in a week. The panic wasn't about left-wing rhetoric — it was about arithmetic. Bolsonaro had proposed a constitutional spending cap; Lula campaigned against it. Markets don't tumble on ideology. They tumble when someone promises to spend money a government doesn't have while telling bondholders the bill is optional.